We live in the society that promotes debt, waste and greed. Competition and style are the idols of today’s America. I would like to share with you some ways of living below the means. After all, material things will never make us happy.
It is human touch, laughing, eye contact, love and times spend together that makes one happy. One does not need to impress the peers to stay happy. It is a trap for one’s existence.
Steven Pressfield in the book “Tides of War” has a great line where someone asks Socrates what freedom is and he responds that the freedom is :
1.) a will
and
2.) the force to exercise that will.
Then, he goes into example describing guys that sit around the fire tyrannized by the opinion of their peer’s and their inability to possess freedom. Sounds like me… My car is not as new as yours… My phone is not as cool as yours…..
I say that we accept ourselves the way we are and stop following illusory images that society conveys today. You can live the life you want and not what others want you to live. After all, life is a precious gift and the free choice of the way one should live the life should be one’s choice.
Do not let external forces (media, school, and peers) to influence your mind and decisions. Forget about quick fixes. If somebody tells you that you need diet pills to lose wait, I say, watch your diet and exercise more.
You should work with the reason instead of curing symptoms.
If you cure the cause, the problem is gone. If you treat symptoms, you will be hooked with pharmaceutical companies. And yes, they want that – you are a revenue generator for them.
So here is ways to live the life below your means
1. Opt Out of Credit Cards
Try to use cash whenever possible. Credit is money you do not have. Credit card companies want you to use their services because they will charge interest and they get commission for each swipe as well.
You have to change behavioral pattern and try to spend the money that you have – cash.
If you have a temptation to use credit cards, consider opting out of offers.
If you are in debt, pay off the highest interest cards and cancel them once you done with the payment. Leave one credit card for emergencies until you create an emergency fund, preferably the one that gives you cash back.
2. Do Not Pay Retail
You can always find the product cheaper online. Do your homework on the web before choosing the best bargain. G1 – Google phone that was introduced in October 2008 has a feature that allows you to scan the bar code and find the same item everywhere including retail locations and on the web. You do not have to buy Google phone and pay a premium for a service. Just search online for an item you want to buy. For instance, in my office we get staples from Office Depot for $4.89 per box. I was able to find it for $0.89 online. This is FIVE times cheaper. It saved our office a lot of money this way.
3. Stop Junk Mail
I often catch myself going to Big Lots to buy something because I received the flier and it is so cheap. Stop Junk Mail if you can not hold yourself from impulsive shopping. I created the page devoted to Junk Mail and it feels good to check mail twice a month now.
4. Buy a New Car With Cash
While it is cool to drive the car that is brand new, you lose 30% as soon as you drive off the lot. That is a lot of money to be saved. Buy used vehicle. Try to pay cash for it. Car note is more expensive and you will end up paying much more for a car at the end. Buy the car from current owner rather then going to the dealer. If you can afford only the car that costs 7,000, buy only within this price range. (Going even further, spend 6,000 and create an emergence fund with another 1000).
You have to remember, the car has to get you from point A to point B.
5. Do Not Refinance Your House
Mortgage brokers are all about low rates and “great savings” but consider the following. Bank wants you to refinance because they will be earning interest. Mortgage broker will make money - spread on the interest.
For instance, once you buy a house and your mortgage is $400, only $20 will go towards the principle and $380 towards the interest. So at the beginning of your ownership you will be paying mostly interest while principle loan amount will stay the same way.
So, it is better for a bank if you keep refinancing or moving every five years because they will make money. So, do not move or refinance, unless the refinancing rate is much cheaper then your current rate and you planning to live in the house for at least 10 years.
Another tip, add extra $100 to your monthly mortgage payment specifying towards the principle. You will be surprised how quickly you can pay off your house. (Adding $100 a month extra will let you pay your house in 22 years instead of 30. It is big difference. Also, you will save about $10,000 on interest.
6. Avoid Restaurants
It is impressive to see how much money is wasted in the restaurants. Me and my friend went to the restaurant another day and ordered chicken. The tab was $35 dollars with tips. I could have the whole chicken from Publix for $7 and it would be enough for 2 people. Spend some time in the grocery store and plan your dinner accordingly, so you do not have to pay premium.
7. Become Spiritually Rich
The definition of being rich is in need of reconsideration. Spend some time with your kid instead of buying him or her Play Station or an X Box. You can not purchase love. Rather then thinking that you are rich and can purchase a new toy for your son or daughter, spend some quality time with them and simply talk and find out how they are doing. This time can not be substituted for any materialistic rewards that we tend to use as "quick fixes" nowadays.
8. Limit Advertisements
Ads will tell you that you suck and you need: brand new car, better cell phone, diet pills, improved formula for your hair, to eat - because Wendy’s is open late, repair your credit, buy the identity theft protection and many other things in order to be happy. Well, fundamentally, state of happiness is either here or not. Remember, you can not purchase happiness. Be Happy right now.
What I have done to limit advertisements is I listen to CD’s in my car (no radio), however I had to buy a new car - 2001 Ford Taurus for $3,000 cash from the local auction and id does not have CD payer.
As soon as commercial comes on the radio, I turn it off.
Reduce the amount of spending in front of the Tube. You can read more how I stopped watching TV.
9. Buy Only What You Need
I came across some interesting statistics that average American buys 100 things and 99 of them end up in trash within first six month. Do not buy accessories (car chargers, phone cases), new clothes (check your closet, instead of donating to Goodwill. Use it, why to spend more money?), new gadgets (old ones are still fine).
10. Stop Being A Consumer
Instead of consuming, use as much as you need but nothing above your basic needs. Do you really need this 72 inch LCD screen? Probably not. Remember that your friends will be impressed only once, after that you will have to stick with it and see your electrical bill going up.
The holiday season is a vivid example how everything is made to spend money. Every holiday is about buying. Mothers Day - have top buy something for mother. Father’s day – for father. Christmas – for everyone, etc.
Do you need that big SUV ? May be not.
11. Stop Going to The Mall
There is nothing there but to take your money away. Instead of going to the mall, go to the park and feed the ducks with your family. Take a trip to camp on a weekend – camping site is inexpensive plus fresh air is a rare opportunity for kids and for you to breath natural air.
Friend of mine’s kid had an allergy on pollen in Atlanta. Sine they started going camping and limited the use of air conditioning (they would rather open windows) the allergy went away. Plus they save money on electricity.
12. Opt Out of a Gym.
Working out in the gym is great, but consider running and doing exercises on the open air rather then breathing recycled in the gym. Local park is a great opportunity and it is free. There are plenty of running trails. Why to pay for a gym since there is a natural replacement available.
In addition it is much healthier to spend time in the park.
Please do not run on the streets since the air is polluted, especially during traffic hours.
13. Do Not Pay For Designer Clothes, Shoes and Accessories
I had an instance where two of my coworkers bought the same dress. One in TJ MAX for $59 and the other one in Nordstroms for $299. It was funny to observe that conversation as they were comparing their shopping at work. Who cares if it says Nike or Puma or whatever it is. You always pay a premium for items that have designer labels on them.
14. Buy Store Brands
In Kroger they have laundry detergent for $0.99 Kroger Brand. Do you think I will pay $3.99 just for label? The key here is that Kroger brand is not advertised, so there is no marketing expenses.
15. Buy Used Books Instead of New Ones
When I was a student in Georgia State University I remember I paid $110 for my math book. I thought it was too much. Since then, I paid no more then $5-10 for a book. Universities encourage professors to push for the latest edition.
Please, be aware that the History of the Unites States and other subjects do not change every year. I was buying the same book just 2-3 editions older and it was almost free – no more then $10. The chapters were moved on purpose to confuse me in couple of books but that was an easy fix – 5 minutes and I compared with my classmate that paid $90 for a book. That was the only time where I had to do something. The rest of the books had the same content, just pages were in off. I would look at the syllabus and find it by the subject. Amazon.com and Half.com are my favorite websites for books. The savings are huge.
16. Enroll in Library
When I was preparing for GMAT test, I found nine books, like Princeton Review and others ( including CD with 5 practice tests) in my local library.
I could keep the book for 4 months - just kept extending online. I also discovered that my local library has free DVD's to watch. The library even has software to learn languages and other valuable programs that most likely I would end up paying for.
17. Buy at Thrift Stores and Yard Sales.
Too proud for this? Peers reassure? Well. Something you are looking for can be there. Me and my friend bought old German knives. The quality is awesome and they were fifty cents each. Comparing to modern Chinese quality one can find a good solution in those places.
Again, do not buy something that you do not need, just what is needed at this time.
18. Reduce your Cable to Basic Package
Most of us are busy all the time and 100 + channels are really not needed. We can not watch all of them anyway. So, adjust your cable just to your needs. Internet is another option. Most of the shows are available at certain share sites for download for free.
You can even watch TV from the whole world online free. Google it. You will be surprised what is out there.
19. Use Online Coupon Codes for Everything
Recently, my friend and I had to rent the truck and transport some windows and doors. Right before check out I thought, let me Google coupon code for Budget. I reduced our expense by 25%. It took 30 seconds to identify the site and find the best coupon. Usually it is a code that you type in while making online reservation. We saved 30 dollars and had a good dinner the same day.
20. Avoid Cigarettes and Alcohol
This is what I have been working on. It’s not only will save me in the long run (I pay $5 for cigarettes – American Spirit) but also ensure that I will be healthier. If you drink and are not going to give it up, then consider drinking at home. It is much cheaper then going to bars.
21. Make Coffee at Home
You can buy coffee making machine and save BIG considering that average cup of coffee is around $4.
22. Stop Watching TV
Are you turning into couch potato watching TV every day after work? It is time to cut that expensive cable or Dish bill, set your mind free and improve your health. You will find abundance of time for other things that you never have time for. You can read how I got rid of My TV.
23. Opt Out of a Costly Wedding
Wedding does not have to cost $30,000 +. You can have a dinner with the most precious people in your life. Fancy banquets and other perks can be left out. I bet you could find a better use for the money that you save on wedding.
My friend took a two week trip to Jamaica and had a wedding there. It was him and his wife. There were witnesses there: Sun, Ocean, Sky and Waves. No ceremony, nothing. He said it was beautiful. And it was inexpensive. After all, it is sacred ceremony for both of you.
24. Practice Meditation
Consider recording meditation music. You can find it on You Tube. Once you picked the track you like, search for a free You Tube converter from video to MP3. Download, install, and convert. Then burn on your CD. This should allow you to relax from the busy stressful day. It will bring tranquility and unplug you for a minute. You will feel revitalized and ready for new challenges. Every time you feel bored and want to go shopping - practice meditation.
25. Pack Your Lunch
Instead of spending $6 a day, bring your own. It is healthier and you will save money.
26. Bulk Shopping
Consider enrolling in wholesale stores like Costco, Sam's Club or BJ's.
Buying in bulk is always cheaper then shopping for an individual item. For instance I needed raisins so I visited my local grocery store. The cost was $3 for a little pack. It was gone in 2 days. In Costco, I found 2 huge bags for total of $6. It lasted me 4 months.
27. Enroll in 401K or Savings Plan
The deduction usually before tax and it is unnoticeable, plus you fool yourself by having to spend less. My college is putting 10% of his paycheck and already has $34,000 in savings. You can always withdraw your money and pay 10% prepayment penalty paid to IRS but it is not recommended.
28. Lower Your Heating Bill
Consider lowering your thermostat couple degrees in winter and increasing by 2 degrees in summer. For instance instead of 70, set it on 68. The savings will be obvious.
29. Do Not Shop on Sundays and Holidays
Spend the time with your family instead. At the same time you will allow other people to reclaim lost Sundays and Holidays. If we don't visit the store, the owner or the company will keep it closed on Sundays and Holidays. I was in Germany for two months and everything was closed on Sunday. This day was devoted solely for family.
30. Stay healthy
Health care is expensive nowadays. Why do we have allergies? Because we lost the touch with outside environment. We run AC in the car, in the stores, at work and in the house. The recycled air is our "best friend" and the source of our allergies at the same time. Expose yourself and kids to outside air and your allergies after awhile will go away. This will save you money on allergy pills as well.
Final Thoughts
Stop living the life for others and live for yourself.
Your freedom is not in making more money but in spending less.
It takes discipline and desire for a change to happen.
Just remember, that you do it for the most precious being in this life - You. Set yourself to financial freedom.
It is human touch, laughing, eye contact, love and times spend together that makes one happy. One does not need to impress the peers to stay happy. It is a trap for one’s existence.
Steven Pressfield in the book “Tides of War” has a great line where someone asks Socrates what freedom is and he responds that the freedom is :
1.) a will
and
2.) the force to exercise that will.
Then, he goes into example describing guys that sit around the fire tyrannized by the opinion of their peer’s and their inability to possess freedom. Sounds like me… My car is not as new as yours… My phone is not as cool as yours…..
I say that we accept ourselves the way we are and stop following illusory images that society conveys today. You can live the life you want and not what others want you to live. After all, life is a precious gift and the free choice of the way one should live the life should be one’s choice.
Do not let external forces (media, school, and peers) to influence your mind and decisions. Forget about quick fixes. If somebody tells you that you need diet pills to lose wait, I say, watch your diet and exercise more.
You should work with the reason instead of curing symptoms.
If you cure the cause, the problem is gone. If you treat symptoms, you will be hooked with pharmaceutical companies. And yes, they want that – you are a revenue generator for them.
So here is ways to live the life below your means
1. Opt Out of Credit Cards
Try to use cash whenever possible. Credit is money you do not have. Credit card companies want you to use their services because they will charge interest and they get commission for each swipe as well.
You have to change behavioral pattern and try to spend the money that you have – cash.
If you have a temptation to use credit cards, consider opting out of offers.
If you are in debt, pay off the highest interest cards and cancel them once you done with the payment. Leave one credit card for emergencies until you create an emergency fund, preferably the one that gives you cash back.
2. Do Not Pay Retail
You can always find the product cheaper online. Do your homework on the web before choosing the best bargain. G1 – Google phone that was introduced in October 2008 has a feature that allows you to scan the bar code and find the same item everywhere including retail locations and on the web. You do not have to buy Google phone and pay a premium for a service. Just search online for an item you want to buy. For instance, in my office we get staples from Office Depot for $4.89 per box. I was able to find it for $0.89 online. This is FIVE times cheaper. It saved our office a lot of money this way.
3. Stop Junk Mail
I often catch myself going to Big Lots to buy something because I received the flier and it is so cheap. Stop Junk Mail if you can not hold yourself from impulsive shopping. I created the page devoted to Junk Mail and it feels good to check mail twice a month now.
4. Buy a New Car With Cash
While it is cool to drive the car that is brand new, you lose 30% as soon as you drive off the lot. That is a lot of money to be saved. Buy used vehicle. Try to pay cash for it. Car note is more expensive and you will end up paying much more for a car at the end. Buy the car from current owner rather then going to the dealer. If you can afford only the car that costs 7,000, buy only within this price range. (Going even further, spend 6,000 and create an emergence fund with another 1000).
You have to remember, the car has to get you from point A to point B.
5. Do Not Refinance Your House
Mortgage brokers are all about low rates and “great savings” but consider the following. Bank wants you to refinance because they will be earning interest. Mortgage broker will make money - spread on the interest.
For instance, once you buy a house and your mortgage is $400, only $20 will go towards the principle and $380 towards the interest. So at the beginning of your ownership you will be paying mostly interest while principle loan amount will stay the same way.
So, it is better for a bank if you keep refinancing or moving every five years because they will make money. So, do not move or refinance, unless the refinancing rate is much cheaper then your current rate and you planning to live in the house for at least 10 years.
Another tip, add extra $100 to your monthly mortgage payment specifying towards the principle. You will be surprised how quickly you can pay off your house. (Adding $100 a month extra will let you pay your house in 22 years instead of 30. It is big difference. Also, you will save about $10,000 on interest.
6. Avoid Restaurants
It is impressive to see how much money is wasted in the restaurants. Me and my friend went to the restaurant another day and ordered chicken. The tab was $35 dollars with tips. I could have the whole chicken from Publix for $7 and it would be enough for 2 people. Spend some time in the grocery store and plan your dinner accordingly, so you do not have to pay premium.
7. Become Spiritually Rich
The definition of being rich is in need of reconsideration. Spend some time with your kid instead of buying him or her Play Station or an X Box. You can not purchase love. Rather then thinking that you are rich and can purchase a new toy for your son or daughter, spend some quality time with them and simply talk and find out how they are doing. This time can not be substituted for any materialistic rewards that we tend to use as "quick fixes" nowadays.
8. Limit Advertisements
Ads will tell you that you suck and you need: brand new car, better cell phone, diet pills, improved formula for your hair, to eat - because Wendy’s is open late, repair your credit, buy the identity theft protection and many other things in order to be happy. Well, fundamentally, state of happiness is either here or not. Remember, you can not purchase happiness. Be Happy right now.
What I have done to limit advertisements is I listen to CD’s in my car (no radio), however I had to buy a new car - 2001 Ford Taurus for $3,000 cash from the local auction and id does not have CD payer.
As soon as commercial comes on the radio, I turn it off.
Reduce the amount of spending in front of the Tube. You can read more how I stopped watching TV.
9. Buy Only What You Need
I came across some interesting statistics that average American buys 100 things and 99 of them end up in trash within first six month. Do not buy accessories (car chargers, phone cases), new clothes (check your closet, instead of donating to Goodwill. Use it, why to spend more money?), new gadgets (old ones are still fine).
10. Stop Being A Consumer
Instead of consuming, use as much as you need but nothing above your basic needs. Do you really need this 72 inch LCD screen? Probably not. Remember that your friends will be impressed only once, after that you will have to stick with it and see your electrical bill going up.
The holiday season is a vivid example how everything is made to spend money. Every holiday is about buying. Mothers Day - have top buy something for mother. Father’s day – for father. Christmas – for everyone, etc.
Do you need that big SUV ? May be not.
11. Stop Going to The Mall
There is nothing there but to take your money away. Instead of going to the mall, go to the park and feed the ducks with your family. Take a trip to camp on a weekend – camping site is inexpensive plus fresh air is a rare opportunity for kids and for you to breath natural air.
Friend of mine’s kid had an allergy on pollen in Atlanta. Sine they started going camping and limited the use of air conditioning (they would rather open windows) the allergy went away. Plus they save money on electricity.
12. Opt Out of a Gym.
Working out in the gym is great, but consider running and doing exercises on the open air rather then breathing recycled in the gym. Local park is a great opportunity and it is free. There are plenty of running trails. Why to pay for a gym since there is a natural replacement available.
In addition it is much healthier to spend time in the park.
Please do not run on the streets since the air is polluted, especially during traffic hours.
13. Do Not Pay For Designer Clothes, Shoes and Accessories
I had an instance where two of my coworkers bought the same dress. One in TJ MAX for $59 and the other one in Nordstroms for $299. It was funny to observe that conversation as they were comparing their shopping at work. Who cares if it says Nike or Puma or whatever it is. You always pay a premium for items that have designer labels on them.
14. Buy Store Brands
In Kroger they have laundry detergent for $0.99 Kroger Brand. Do you think I will pay $3.99 just for label? The key here is that Kroger brand is not advertised, so there is no marketing expenses.
15. Buy Used Books Instead of New Ones
When I was a student in Georgia State University I remember I paid $110 for my math book. I thought it was too much. Since then, I paid no more then $5-10 for a book. Universities encourage professors to push for the latest edition.
Please, be aware that the History of the Unites States and other subjects do not change every year. I was buying the same book just 2-3 editions older and it was almost free – no more then $10. The chapters were moved on purpose to confuse me in couple of books but that was an easy fix – 5 minutes and I compared with my classmate that paid $90 for a book. That was the only time where I had to do something. The rest of the books had the same content, just pages were in off. I would look at the syllabus and find it by the subject. Amazon.com and Half.com are my favorite websites for books. The savings are huge.
16. Enroll in Library
When I was preparing for GMAT test, I found nine books, like Princeton Review and others ( including CD with 5 practice tests) in my local library.
I could keep the book for 4 months - just kept extending online. I also discovered that my local library has free DVD's to watch. The library even has software to learn languages and other valuable programs that most likely I would end up paying for.
17. Buy at Thrift Stores and Yard Sales.
Too proud for this? Peers reassure? Well. Something you are looking for can be there. Me and my friend bought old German knives. The quality is awesome and they were fifty cents each. Comparing to modern Chinese quality one can find a good solution in those places.
Again, do not buy something that you do not need, just what is needed at this time.
18. Reduce your Cable to Basic Package
Most of us are busy all the time and 100 + channels are really not needed. We can not watch all of them anyway. So, adjust your cable just to your needs. Internet is another option. Most of the shows are available at certain share sites for download for free.
You can even watch TV from the whole world online free. Google it. You will be surprised what is out there.
19. Use Online Coupon Codes for Everything
Recently, my friend and I had to rent the truck and transport some windows and doors. Right before check out I thought, let me Google coupon code for Budget. I reduced our expense by 25%. It took 30 seconds to identify the site and find the best coupon. Usually it is a code that you type in while making online reservation. We saved 30 dollars and had a good dinner the same day.
20. Avoid Cigarettes and Alcohol
This is what I have been working on. It’s not only will save me in the long run (I pay $5 for cigarettes – American Spirit) but also ensure that I will be healthier. If you drink and are not going to give it up, then consider drinking at home. It is much cheaper then going to bars.
21. Make Coffee at Home
You can buy coffee making machine and save BIG considering that average cup of coffee is around $4.
22. Stop Watching TV
Are you turning into couch potato watching TV every day after work? It is time to cut that expensive cable or Dish bill, set your mind free and improve your health. You will find abundance of time for other things that you never have time for. You can read how I got rid of My TV.
23. Opt Out of a Costly Wedding
Wedding does not have to cost $30,000 +. You can have a dinner with the most precious people in your life. Fancy banquets and other perks can be left out. I bet you could find a better use for the money that you save on wedding.
My friend took a two week trip to Jamaica and had a wedding there. It was him and his wife. There were witnesses there: Sun, Ocean, Sky and Waves. No ceremony, nothing. He said it was beautiful. And it was inexpensive. After all, it is sacred ceremony for both of you.
24. Practice Meditation
Consider recording meditation music. You can find it on You Tube. Once you picked the track you like, search for a free You Tube converter from video to MP3. Download, install, and convert. Then burn on your CD. This should allow you to relax from the busy stressful day. It will bring tranquility and unplug you for a minute. You will feel revitalized and ready for new challenges. Every time you feel bored and want to go shopping - practice meditation.
25. Pack Your Lunch
Instead of spending $6 a day, bring your own. It is healthier and you will save money.
26. Bulk Shopping
Consider enrolling in wholesale stores like Costco, Sam's Club or BJ's.
Buying in bulk is always cheaper then shopping for an individual item. For instance I needed raisins so I visited my local grocery store. The cost was $3 for a little pack. It was gone in 2 days. In Costco, I found 2 huge bags for total of $6. It lasted me 4 months.
27. Enroll in 401K or Savings Plan
The deduction usually before tax and it is unnoticeable, plus you fool yourself by having to spend less. My college is putting 10% of his paycheck and already has $34,000 in savings. You can always withdraw your money and pay 10% prepayment penalty paid to IRS but it is not recommended.
28. Lower Your Heating Bill
Consider lowering your thermostat couple degrees in winter and increasing by 2 degrees in summer. For instance instead of 70, set it on 68. The savings will be obvious.
29. Do Not Shop on Sundays and Holidays
Spend the time with your family instead. At the same time you will allow other people to reclaim lost Sundays and Holidays. If we don't visit the store, the owner or the company will keep it closed on Sundays and Holidays. I was in Germany for two months and everything was closed on Sunday. This day was devoted solely for family.
30. Stay healthy
Health care is expensive nowadays. Why do we have allergies? Because we lost the touch with outside environment. We run AC in the car, in the stores, at work and in the house. The recycled air is our "best friend" and the source of our allergies at the same time. Expose yourself and kids to outside air and your allergies after awhile will go away. This will save you money on allergy pills as well.
Final Thoughts
Stop living the life for others and live for yourself.
Your freedom is not in making more money but in spending less.
It takes discipline and desire for a change to happen.
Just remember, that you do it for the most precious being in this life - You. Set yourself to financial freedom.
